Dunkin’ teams with Grubhub to offer delivery service to rival Starbucks

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In a bid to keep pace with coffee archrival Starbucks’ delivery and mobile order-ahead services, Dunkin’ is working with Grubhub to roll out New York delivery.

The new Dunkin’ Delivers service, which is planned for a nationwide rollout, is first being launched in New York City’s five boroughs across 400 Dunkin’ stores. The service will be offered through Seamless, Grubhub’s New York brand. After the initial launch, Dunkin’ and Grubhub will seek to expand the Dunkin’ Delivers service to Boston, Chicago and Philadelphia markets in the coming months. No timetable for a nationwide rollout was offered.

"We've collaborated closely with Grubhub to optimize the service in our initial testing, and we've been encouraged by the strong customer response. We are thrilled to launch Dunkin' Delivers in New York City today and look forward to working with Grubhub to expand the service in additional cities in the months ahead,” Stephanie Meltzer-Paul, vice president of digital and loyalty marketing for Dunkin' U.S., said in the press release.

Grubhub has integrated itself with Dunkin’s point-of-sale systems to ensure accuracy.

Dunkin’ has been working to keep up with Starbucks, which was a pioneer of mobile payments and delivery services. Starbucks has deep experience in offering global coffee delivery services, having piloted efforts in several countries, including the U.S. over the last few years. Starbucks signed a deal with UberEats last December to add more than 2,000 stores in the U.S., about a quarter of its footprint, to the company’s delivery service. This follows Starbucks' limited UberEats delivery pilot in Miami with 100 stores last September. Starbucks had been piloting delivery services with Postmates since 2015 before ultimately settling on UberEats as its delivery partner.

Starbucks has also been piloting delivery in China with Alibaba’s food delivery subsidiary, Ele.Me, covering 1,000 stores since last November. Starbucks also plans to expand delivery services to its stores in Japan with UberEats in a phased rollout. Starbucks has 1,400 stores in Japan with plans to build 300 more over the next three years.

In terms of rewards and order-ahead advantages, Starbucks counts 16.8 million active U.S. members in its rewards program, compared with Dunkin’s 10 million members. Over 41% of Starbucks sales by dollar volume is generated from its mobile app and 15% of its sales (by transactions) are from its order-ahead feature. No financial details on Dunkin’s mobile app are publicly available.

Dunkin’ added the order-ahead service in 2017 by partnering with the navigation app Waze, fully two years after Starbucks rolled the feature out nationally to its 7,400 stores (at the time). Starbucks had been testing order-ahead in the Pacific Northwest and then about 4,000 stores by the time it decided to go national.

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